By Nermeen Nabil Khear TLDR
- President Trump’s Bitcoin Strategic Reserve decision excluded major tokens like XRP, DOGE, and ADA, causing prices to drop up to 9%
- Over $400 million in liquidations occurred on bullish crypto futures bets, primarily from BTC-tracked products
- Bitcoin itself fell from $93,000 to under $88,000 despite being the centerpiece of Trump’s plan
- Traders’ expectations have lowered after the strategic reserve announcement failed to meet expectations
- All eyes are on today’s White House Crypto Summit, though expectations remain modest for any market-moving announcements
The cryptocurrency market experienced a sharp downturn as XRP, Dogecoin (DOGE), and Cardano (ADA) fell by as much as 9% in the past 24 hours. This drop followed President Donald Trump’s decision to establish a Bitcoin Strategic Reserve that excluded these popular tokens.
Late Thursday, Trump directed his administration to create a reserve that would only hold Bitcoin seized by the government. The plan includes an additional “crypto stockpile” for other assets, but these would be limited to cryptocurrencies the government happens to seize.
The announcement reversed days of bullish momentum in the crypto market. Earlier optimism had been fueled by Trump’s previous comments that suggested the reserve might include tokens like XRP, ADA, Ethereum (ETH), and Solana (SOL).
Many traders had hoped that government purchases would create buying pressure for various cryptocurrencies. Instead, the news that only Bitcoin would be actively held in the reserve sent altcoin prices downward.
Dogecoin had seen a 12% price increase earlier in the week. This spike came after NYSE Arca filed for approval of Bitwise’s DOGE exchange-traded fund (ETF).
Some traders had speculated that DOGE might be included in the strategic reserve. Those hopes were dashed by Trump’s announcement that focused solely on Bitcoin.
Even Bitcoin wasn’t immune to the market downturn. The price dropped 4.5% from a 24-hour high above $93,000 to under $88,000 despite being the centerpiece of Trump’s plan.
Market Impact and Liquidations
The CoinDesk 20 index, which tracks the largest tokens by market value, fell 5%. Smaller altcoins experienced even steeper declines of up to 10%.
The price slide triggered over $400 million in liquidations on bullish bets in crypto futures. Bitcoin-tracked products accounted for $230 million of these losses.
Traders are now looking to the White House Crypto Summit scheduled for March 7. The event brings together industry leaders, policymakers, and government officials to discuss the future of digital assets.
Despite the high-profile nature of the summit, expectations remain modest. Nick Ruck, director at LVRG Research, told CoinDesk, “Traders have lowered expectations since the strategic reserve announcement failed to live up to expectations.”
Ruck added that Trump hasn’t promised anything major for the summit that could offset current market sentiment. There remains a risk-off mood among crypto traders.
Some still hold hope for surprise announcements at the summit. The presence of blockchain company leaders and key government officials leaves room for unexpected developments.
The summit aims to address both the opportunities and challenges presented by cryptocurrencies. Key topics include the establishment of the strategic reserve and development of regulatory frameworks.
Coinbase CEO Brian Armstrong expressed optimism about the government’s approach. He stated that a clear regulatory framework would help boost innovation and adoption in the crypto space.
Bitwise CEO Hunter Horsley offered a more cautious view. He pointed out the complexities of including altcoins in a national reserve and suggested a more measured approach might be needed.
The summit represents the administration’s effort to position the U.S. as a leader in digital assets. Officials hope to strike a balance between promoting technological advancement and maintaining regulatory oversight.
The post Crypto Market Experiences Downturn Following Trump’s Bitcoin Reserve Plan appeared first on Blockonomi.
This articles is written by : Nermeen Nabil Khear Abdelmalak
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